Basic business advice for those converting part time gigs into "real" business ventures. Slides are a little wordier than usual; the Podcamp Philly Version will be a little more streamlined.

1. Business 101
for Nerds
An Ounce of Prevention is worth a pound of
cure

2. You’re Passionate

3. You’ve Got Ideas

4. I can start my own Business!

5. Awesome!
Let’s Get Started!

6. We’re covering
• Getting Started
• When does “it” become a business?
• Business Models (Corp, LLC, etc.)
• Scalability and Outsourcing
• Avoiding Common Problems (taxes &
liability)

7. Most People...
• Just start working
• Hand-shake deals
• No written
agreements
• No plans to scale
• Outsourcing?
• Cash flow?

8. Preparing for the Best
and the Worst

9. SBA Business Facts
• 7 out of 10 businesses survive 2 years
• 51% last 5 years
• Small businesses employ about 1/ 2 the
private sector employees
• 40% high tech workers
• 52% are home-based and 2% are franchises

10. Reasons for Success
• Great Leadership/management
• Attract and Attain Quality People
• Disciplined Approach
• Strategic use of Tech
• Use of Trusted relationships
(network)
• Teamwork and Quality

12. Reasons for Failure
• Lack of Experience • Mixing Personal and
Business funds
• Insufficient Capital
• Poor Credit
• Location issues
• Competition
• Poor Management
• Low sales
• Lack of a Plan
• Unexpected growth

13. The Plan is a Map for your
Business

14. Start with:
• Try Writing a business plan- Easy
Templates at SBA.gov
• Add: List of Pros/cons
• Add: People I can rely on for help
• Add: Assets I’m willing to Invest
• Benchmarks for Success

15. Elements of a Plan
• Executive Summary: What are you going to do and
why?
• Market Analysis:
• What else is happening here?
• Blue Ocean? Played Out?
• How do you have an advantage?
• First Rule- Be Awesome

16. Elements Continued
• Description: What your company is going to do; how it
solves a problem, why it’s needed
• Organization and Management: Who is responsible for
what? How are they contributing and generating
income?
• Marketing and Sales: How are you going to find
customers and how are you going to measure their
value? (ROI)
• Product: What are you doing to generate Money?

17. • How much money/tools/resources do you need
to get started?
• What do you need in reserve if those tools break/
fail/need replacement?
• What kind of cash flow do you need? Be
prepared for customers not paying on time, or
not paying at all. How much of a “hit” can you
take and still stay in business?

18. The Business of Dorian Gray?

19. Is it a BUSINESS or a Hobby?
• Is this business or pleasure, or both?
• Would you like to make money from
this work?
• Is this a side job or full time one?
• What are you doing for income outside
of new/social media?

20. Business
• It’s about doing what you love, AND
it’s about the money
• You can do it and Stand Out
• You are patient and willing to do
WHATEVER it takes to succeed
• You know what Success means to you
• (Write it down, define it)

21. Keep That day job!

22. Hobby
• You do it because You get something
out of the process
• Not cost-effective (handknitting)
• Even if material cost low, time input
makes it low-profit/margin
• It’s enjoyable because there’s no
pressure, pressure would ruin the joy

23. Who Wants to feel like this?

24. Or This?

25. Can You “Date” the job?
• Is it possible to work with
someone else first and learn
the business?
• Spoilage, theft, supply chain,
cash flow, overhead, etc. All
need to be factored in along
with the romance of being your
own boss

27. Can you form a “Guild?”

29. Steady Income Stream
• It doesn’t have to be
Niagara, but it should
be regular and
predictable
• Consider when/what
you need to outsource
and what that’s gonna
cost

30. Ten Things Everyone Forgets
• State Business License
• City Business License
• Insurance - business, health, worker’s comp, etc.
• Payment and Work Schedule: what’s due when
• Taxes- Fill out the forms
• Taxes- Deposits to avoid Surprises

31. 10 Things Cont.
• Keep track of expenses, deductables (mileage,
parking, business meals, phone, internet fees,
hotels, etc.)
• Separate Personal and Professional money
• Business Correspondence- keep it organized, and
easily retrieved
• Contracts: Get it in Writing
• You will get sick and/or need vacation. Plan
accordingly.

32. How Locked In
are You?
Fully?
Combination lock?
Cheap plastic
luggage lock?

33. First Steps:
• Need to be a good accountant;
separate business from personal.
• Separate business account (EIN?)
• Track business expenses

34. “Formal” Business
• With an LLC or Inc., you
separate personal from
business
• “Limits of Liability”-
business does not bankrupt
You
• You are the caretaker of the
“strawman”- Fiduciary
responsibility

35. LLC, Incorporate, or...
• Is this you alone, or will you have
partners?
• Will you have employees, or
independent contractors?
• What is your liability/growth
potential?

36. Example: consulting
• Project work income; freelance
assignments
• If income exceeds approx $10K per
year, or you anticipate it will exceed
10K, you should consider treating it
like a business.

37. Consulting
• Time needed to generate business;
marketing yourself to ensure steady
and reliable income stream (Atty
model)
• Ability to scale and outsource- you
can’t do it all, but when can you afford
help?

38. If you incorporate:
• The Company Corporation- fast,
efficient and cheap. (works for LLC as
well- please let them know I sent you)
• Consider incorp in Delaware
(favorable laws and tax rules)

39. What Does
Your Org
Chart Look
Like?

40. The Tax Man

41. The Tax Man
• Keep it all separate means also filing
taxes for business, paying quarterly
deposits, etc.
• It also means shielding your assets if
things go belly up.
• The Tax Man is cranky if you don’t
follow the rules.

42. An Ounce of
Prevention...
• Most small businesses fail because
they were undercapitalized (keep
the day job)
• Be clear up front when mixing
friends/family and $$$
• Put it in writing (freedom of
Contract)

43. Summary
• Write a Plan
• Use Freelance Calculators; know your
“Burn rate”
• Understand Money
• READ

44. Recommended
• The Knack: How Street Smart Entrepreneurs
learn how to handle whatever comes up - Norm
Burlingham, Bo Brodsky
• Lost & Found - Geneen Roth
• SBA Podcasts; Available Free Courses (The tech one is
REALLY basic)

45. Resources
• Freelance Calculator
www.freelanceswitch.com/rates/
• Fun Project Quote Calculator http://
devgrow.com/freelance-project-quote-estimator/
• Freelance Writing http://allfreelancewriting.com/
freelance-writing-rate-calculator/
• Wage Calculator http://us.thesalarycalculator.co.uk/
hourly.php

46. Questions?
Whitney Hoffman
ldpodcast@gmail.com
twitter:@ldpodcast, @whitneyhoffman
skype: Whitney.Hoffman

47. • “The problem with the Internet startup craze isn’t that too many
people are starting companies; it’s that too many people aren’t
sticking with it. That’s somewhat understandable, because there
are many moments that are filled with despair and agony, when
you have to fire people and cancel things and deal with very
difficult situations. That’s when you find out who you are and what
your values are.
• “So when these people sell out, even though they get fabulously
rich, they’re gypping themselves out of one of the potentially most
rewarding experiences of their unfolding lives. Without it, they
may never know their values or how to keep their newfound wealth
in perspective.” [Fortune, Jan. 24, 2000]